As Sangamo Therapeutics runs out of cash, Eli Lilly and Astellas have emerged as stalking horse bidders for key assets, including a Fabry gene therapy currently being submitted for potential FDA approval.
After over a year of struggle and strife, Sangamo Therapeutics has filed for bankruptcy and is selling off its pipeline, including a rare disease gene therapy that is in the process of being submitted for FDA review. That asset is now earmarked for purchase by Astellas, while pharma giant Eli Lilly is bidding for a handful of platforms from the California biotech.
Lilly is specifically eyeing Sangamo’s capsid delivery, zinc finger and modular integrase platforms, according to a Tuesday release. The pair have already worked together, with Lilly paying $18 million upfront last April to use Sangamo’s adeno-associated virus capsid STAC-BBB technology to develop a gene therapy for a disease of the central nervous system. The back-loaded deal could have topped out at $1.4 billion if Sangamo met certain milestones.
Sangamo is also selling its prion disease program, coded ST-506, to Lilly. The AAV-based, one-time gene therapy targets a neurodegenerative condition and was designed using STAC-BBB tech, aligning with the scope of the Lilly licensing deal, though it has not been explicitly confirmed as an asset from the 2025 partnership. Early-stage activities designed to get the program into the clinic are currently in motion.
Meanwhile, the public biotech has also struck a separate deal with Astellas for one of its most advanced assets, a pivotal-stage gene therapy for Fabry disease known as isaralgagene civaparvovec or ST-920. Last year, Sangamo shared pivotal Phase 1/2 data showing that the therapy improved kidney function at 52 weeks for patients with the rare genetic disorder.
The biotech began a rolling submission for a biologics license application in December 2025 and was continuing to submit data for the application in March of this year. Sangamo is hoping to use the agency’s accelerated approval pathway.
In tandem with the Lilly and Astellas deals, Sangamo has filed for voluntary Chapter 11 bankruptcy to launch “a court-supervised reorganization” that is expected to include all of the biotech’s assets.
Given the bankruptcy, Lilly and Astellas will serve as “stalking horse bidders,” meaning they have agreed to be the initial, baseline bidder for the agreed-upon assets in the court‑supervised auction. In exchange for their bid, the companies will likely receive certain deal protections.
Another Sangamo asset that isn’t included under the stalking horse deals but is expected to be put up for sale is a one-time gene therapy called giroctocogene fitelparvovec. Designed to treat hemophilia A, the late-stage candidate has received Fast Track, Regenerative Medicine Advanced Therapy and Orphan Drug designations from the FDA.
The gene therapy once had Pfizer’s support via a licensing deal, but the pharma terminated the agreement at the end of 2024, triggering a stock slide for Sangamo. A month prior, Sangamo had said it only had enough money to last until the first quarter of 2025, with Lilly coming in at the final hour with its April licensing deal.
The bankruptcy and asset sale news come relatively quickly after Sangamo announced its search for strategic alternatives on June 8.
“Following a comprehensive review of available alternatives, we believe this process provides a clear framework to pursue value‑maximizing transactions,” Sangamo CEO Sandy Macrae said in Tuesday’s release.
According to Sangamo’s bankruptcy filing, the biotech owes money to numerous creditors, including Catalent Pharma Solutions and Charles River Laboratories.
